Driving a bargain

On the Santro Xing, HYUNDAI customers can get between Rs 12,000 and Rs 15,000 off on insurance depending upon the variant and a Rs 3,000 cash discount. Despite not having any trouble selling their latest superstar, the i10, Hyundai is offering free insurance on all its variants. They also have a Rs 6,000 cash discount on the Getz Prime.

TATA MOTORS, which has been struggling to keep up sales, has Rs 25,000 off on the petrol Indica’s power-steering model.
CHEVROLET is marketing the U-VA much more aggressively in what can be seen as an attempt to become a bigger player in this key segment in the Indian auto market. In addition to insurance you get a cash discount of Rs 14,000 which means that you can now get its fully-loaded 5.24-litre LT model for less than Rs 5 lakh and its base model for as little as Rs 4 lakh. It also comes with a free maintenance 3 years/ 45000kms package. The company allows you to save up to Rs 58,000 on the Spark plus a three-year/100,000-km warranty, an industry first in the mini-car segment.

Rounding up the discounts on this most price sensitive of segments, the Fiat Palio offers a Rs 30,000 and Rs 40,000 discount on their diesel and petrol models, respectively, which only shows that it pays to purchase cars that run on more eco-friendly fuel.

SEDANS
In the more aspirational sedan segment, while the starting on-road prices are much higher, the festival offers are also more and diverse.
FORD offers a gift certificate from Tanishq worth Rs 20,000 on purchase of the Fiesta which could come in handy for purchasing gold coins for all those feeling skittish about the state of the economy. Alternatively, they also allow you to take a cash discount worth the same amount. On the Ikon they leave it to their customers to decide what to do with the Rs 45,000 cash discount.

Not to be outdone, HYUNDAI is offering a Rs 2,000 cash discount on the Accent and a Rs 10,000 discount on the Verna. In addition, if you are an existing Hyundai customer or have owned a Hyundai car in the past, you get an additional Rs 10,000 discount for customer loyalty or a Rs 20,000 rebate when you exchange your existing Hyundai.

CHEVROLET continues its march to acquire a greater market share in India wooing customers to buy both the Aveo and the Optra. Post insurance cuts and a cash discount of Rs 12,000 you can now purchase the base model for about Rs 6.25 lakh and the limited edition top model for Rs 6.83 lakh down from Rs 6.55 lakh and Rs 7.14 lakh respectively. On all the Optra’s petrol and diesel variants they offer customers discounts on insurance and Rs 20,000 up front in cash. Petrol-based models come cheaper than their diesel counterparts with the petrol base model dipping to Rs 8.59 lakh and the top diesel variant, the most expensive of the lot, for a mere Rs 10.89 lakh as opposed to the Rs 11.42 lakh, all before the application of discounts.

The success of the Toyota Corolla has naturally got old adversaries HONDA on its toes and it looks determined to make a big sales push this festival season. It offers an inbuilt warranty on all variants of the Civic in addition to insurance discount of Rs 35,000, Rs 38,000 and Rs 40,000 on the three variants. The real winner in terms of deals is the Honda City. On the base, GXI and automatic models priced between Rs 7.54 lakh and Rs 8.76 lakh (on road prices), you get your full insurance for a year (about Rs 7,500) plus four years road-side assistance and warranty. As their sales assistant mentioned, with this sort of deal you can spend the next four years with total peace of mind despite the shaky economic scenario.

SUVs
THE only major offer in SUVs comes from Mahindra’s Scorpio, priced between Rs 8.47 lakh and Rs 11.09 lakh. On the base model of the Scorpio, the insurance of Rs 31,446 is free. Other models offer cash discounts between Rs 20,000 and Rs 22,000. The Chevrolet Tavera has up to Rs 46,000 off.

None of the other SUV manufacturers have felt the need to offer any discount this Diwali. They probably feel if you can afford to look at the SUV segments then clearly you are probably far less susceptible to the vagaries of the economy than your hatchback purchasing counterparts. On the other hand, perhaps the liquidity crunch has put greater pressure on their margins and they cannot afford to offer discounts in so tiny a segment.

THE LOAN DRIVE
DESPITE all that the season has to offer, unless you are independently wealthy or have been uncompromisingly saving for the past several years, you will probably need to take out an auto loan to finance your car. Securing your financing ahead of time also comes in handy when negotiating the price of a car.

Most dealerships provide financing, but they don’t always provide the best possible deal on financing. It is best to secure financing from your bank or an online lender. If the dealership from which you buy your car can match or better your bank’s terms or offers a rebate as part of their financing package, you might then consider using the dealership as your lender. Dealers often receive incentives for target achievements from the manufacturers in addition to the mark-up that they have on the sale price of the car. A dealer who is likely to receive a substantial incentive by selling a certain volume of cars in a given month may be willing to part with a much higher level of discount than another dealer who is unlikely to receive any incentive.

The Motley Fool (fool.com) has several online auto calculators that can help you determine which financing offer is better, what terms make sense in relationship to your budget, what your monthly payments will be and whether it’s better for you to finance or outright buy your vehicle.

The three key things to concentrate on when taking a loan is its term, interest rates and the down payment you make at the time of purchase. The term is an important consideration as the longer it takes for you to pay back the loan, the more you will pay in interest. The down payment you make is also key for the similar reason—the larger the down payment, the smaller the loan you’ll have to repay to begin with.

Your interest rate will, in part, be determined by your credit history. The APR (annual percentage rate) is the best way to determine the actual interest rate you pay annually on the unpaid balance of the loan. The rate you are offered will to a large extent depend on your credit score, a number that dealers get from your credit report.

If you plan to get your free credit report online, be careful not be scammed by the dozens of fraudulent websites offering free credit reports. The only website authorised to give you a report is AnnualCreditReport.com.
And regardless of which financing deal you go for, never forget to check the fine print and ask about sneaky penalty clauses or hidden charges that may be associated with your loan.

THE Paper work
Eligibility criteria and the associated documents required varies over banks and depends on the employment of the individual taking the loan:
Income proof
Salaried individuals: Latest salary slip or salary certificate. Form 16 of the previous financial year or latest Income-Tax returns
Self-employed individuals: Income-Tax returns of two previous financial years
Identity proof: Copy of passport/ voters ID card/ driving licence
Signature proof
Address proof: Copy of ration card/ telephone or electricity bill/ rent agreement/ passport/